Nearly five months after Target revealed a huge pre-Christmas security breach in which hackers stole millions of customers’ credit and debit card records, Target’s CEO has resigned. Greg Steinhafel, who was also Target’s president and chairman, has become the first CEO of a major corporation to lose his job over the breach of customer data. Steinhafel, a 35-year veteran of the company and chief executive since 2008, also resigned from Target’s board of directors on May 5. Hopefully, the departure of Steinhafel means the company is trying to start with a clean slate as it wrestles with the fallout of the data breach. The company’s sales, profit and stock price have all suffered since the breach was disclosed.
Steinhafel’s departure comes two months after Target announced the resignation of Chief Information Officer Beth Jacobs and outlined a series of changes it was making to overhaul its security systems and its security department. In late April, Target announced that next year Master Card Inc., will provide branded credit and debit cards with a more secure chip and PIN technology. It should be noted that chip and PIN technology has been used in Europe for more than a decade.
Target’s Chief Financial Officer John Mulligan has been named interim president and CEO. Steinhafel faced increasing pressure since it was revealed on December 19 that the data breach had compromised 40 million credit and debit card accounts between November 27 and December 15, 2013. Then on January 10, 2014, Target announced that hackers also stole personal information – including names, phone numbers, email addresses and mailing addresses – belonging to nearly 70 million Target customers.
When the dust finally settles, Target’s breach may eclipse the largest known data theft at a U.S. retailer, one disclosed in 2007 at the parent company of TJ Maxx that affected 90 million records. Interestingly, the TJ Maxx data breach did not directly lead to the ouster of that company’s CEO. If you need more information on the Target litigation contact Larry Golston, a lawyer in our firm’s Consumer Fraud Section, at 800-898-2034 or by email at Larry.Golston@beasleyallen.com. Larry, along with Dee Miles, the Section Head, are handling this litigation for the firm. Dee, as will be mentioned in another part of this issue, has received an important appointment in the Target litigation MDL.
Sources: www.huffingtonpost.com; www.ap.org.
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